Exhibit 1.01
SELLING AGREEMENT
Dated as of __________, 1997
Xxxx Xxxxxx Xxxxxxxx Inc.
0 Xxxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Xxxx Xxxxxx Portfolio Strategy Fund L.P., a limited partnership
organized pursuant to its certificate of limited partnership filed on August 28,
1990, as amended on July 24, 1996 (as amended, the "Certificate of Limited
Partnership") and its limited partnership agreement dated as of August 28, 1990,
as amended and restated as of ________, 1997, (as amended and restated, the
"Limited Partnership Agreement") under the law of the State of Delaware (the
"Partnership"), proposes, subject to the terms and conditions set forth in this
Agreement, to offer, sell, and issue up to 50,000 Units of Limited Partnership
Interest of the Partnership (the "Units").
Demeter Management Corporation, a Delaware corporation, is the sole
general partner of the Partnership (the "General Partner"). Xxxx X. Xxxxx &
Company, Inc. a California corporation (the "Trading Advisor"), acts as trading
advisor with respect to the management of the Partnership's trading activities
pursuant to an amended and restated management agreement between the Trading
Advisor, the Partnership and the General Partner (the "Management Agreement")
dated as of the Closing, as such term is defined in the Partnership's Prospectus
(defined below).
Xxxx Xxxxxx Xxxxxxxx Inc., a Delaware corporation, will act as
selling agent pursuant to this Agreement ("DWR") and acts as commodity broker
(in such capacity, the "Commodity Broker") pursuant to an amended and restated
customer agreement between the Partnership and the Commodity Broker dated as of
September 1, 1996, (the "Customer Agreement"). Subscriptions for Units will be
held by The Chase Manhattan Bank (in such capacity, the "Escrow Agent") pursuant
to an escrow agreement dated among the Partnership, The Chase Manhattan Bank and
DWR (the "Escrow Agreement").
1. Representations and Warranties of the General Partner and the
Partnership. The General Partner and the Partnership represent and warrant to
each of the other parties hereto, as follows:
(a) The Partnership has provided to the Trading Advisor and
DWR and filed with the Securities and Exchange Commission (the "SEC") a
registration statement on Form S-1 (No. 333- ), as filed with: (i) the SEC on
________, 1997 and a related preliminary prospectus (which has not been
distributed to the public) for the registration of the Units under the
Securities Act of 1933, as amended (the "1933 Act"), and the rules and
regulations promulgated thereunder (the "SEC Regulations"), and has filed copies
thereof with; (ii) the Commodity Futures Trading Commission (the "CFTC") under
the Commodity Exchange Act, as amended (the "CEAct") and the rules and
regulations promulgated thereunder (the "CFTC Rules"); (iii) the National
Association of Securities Dealers, Inc. (the "NASD") pursuant to its Conduct
Rules; and (iv) the National Futures Association (the "NFA") in accordance with
NFA Compliance Rule 2-13, and has filed any such amendments thereto and any such
amended prospectuses as may have been required by the SEC or the CFTC or any
other applicable regulatory authority or as advised by counsel as of the date
hereof. The registration statement, as amended and previously delivered to all
parties hereto and the amended prospectus included therein are hereinafter
called the "Registration Statement" and the "Prospectus," respectively, except
that (i) if the Partnership files a post-effective amendment to the registration
statement, then the term "Registration Statement" shall, from and after the
declaration of the effectiveness of such post-effective amendment, refer to the
registration statement as amended by such post-effective amendment thereto, and
the term "Prospectus" shall refer to the amended prospectus then on file with
the SEC as part of the Registration Statement, and (ii) if a subsequent
prospectus is filed pursuant to Rule 424 of the SEC Regulations, the term
"Prospectus" shall refer to the prospectus most recently filed pursuant to such
Rule from and after the date on which it shall have been first used, including
any amendment or supplement thereto, from and after the date on which it shall
have been first used. The Partnership will not file any amendment to the
Registration Statement or any amendment or supplement to the Prospectus unless
DWR and the Trading Advisor have received reasonable prior notice of and a copy
of such amendments or supplements and have not reasonably objected thereto in
writing.
(b) The Limited Partnership Agreement provides for the
subscription for and sale of the Units; all action required to be taken by the
General Partner and the Partnership as a condition to the sale of the Units to
qualified subscribers therefor has been, or prior to the Closing as defined in
Section 6(b) hereof will have been, taken; and, upon payment of the
consideration therefor specified in each accepted Subscription and Exchange
Agreement and Power of Attorney in the form attached to the Prospectus, the
Units will constitute valid limited partnership interests in the Partnership.
(c) The Partnership is a limited partnership duly organized
pursuant to the Certificate of Limited Partnership, the Limited Partnership
Agreement, and the Delaware Revised Uniform Limited Partnership Act ("DRULPA"),
and is validly existing under the laws of the State of Delaware with full power
and authority to engage in its activities as described in the Prospectus; the
Partnership has received a certificate of authority to do business in the State
of New York as provided by Section 120-902 of the New York Revised Limited
Partnership Act and is qualified to do business in each jurisdiction in which
the nature or conduct of its business requires such qualification and where
failure to be so qualified could materially adversely affect the Partnership's
ability to perform its obligations hereunder or under the Management Agreement,
the Customer Agreement, the Escrow Agreement, or the Limited Partnership
Agreement, as applicable.
-2-
(d) The General Partner is duly organized and validly existing
and in good standing as a corporation under the laws of the State of Delaware
and in good standing and qualified to do business as a foreign corporation under
the laws of the State of New York and is qualified to do business and is in good
standing as a foreign corporation in each jurisdiction in which the nature or
conduct of its business requires such qualification and where the failure to be
so qualified could materially adversely affect the General Partner's ability to
perform its obligations hereunder or under the Management Agreement, the Limited
Partnership Agreement, or as described in the Prospectus.
(e) The Partnership and the General Partner have full
partnership or corporate power and authority under applicable law to conduct
their business and to perform their respective obligations, as applicable, under
the Limited Partnership Agreement, the Escrow Agreement, the Management
Agreement, the Customer Agreement, and this Selling Agreement (this
"Agreement").
(f) The Registration Statement and Prospectus contain all
statements and information required to be included therein by the CEAct and the
CFTC Rules. At all times subsequent to the Registration Statement having become
effective under the 1933 Act up to and including the Closing, the Registration
Statement and Prospectus have complied and will comply in all material respects
with the requirements of the 1933 Act, the SEC Regulations, the CEAct, the CFTC
Rules, and the rules of the NASD and NFA. As of its effective date, the
Registration Statement did not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading. The Prospectus, as of its date of
issue and at the Closing, did not and will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
therein, in light of the circumstances under which such statements were made,
not misleading. Any supplemental sales literature employed in the offering of
Units ("Sales Literature"), when read in conjunction with the Prospectus, will
not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in light of the circumstances
under which such statements were made, not misleading. The Sales Literature will
comply with the CEAct, the CFTC Rules, SEC Regulations, and the rules of the NFA
and NASD. This representation and warranty shall not, however, apply to any
statement or omission in the Registration Statement, Prospectus or Sales
Literature relating to the Trading Advisor or made in reliance upon and in
conformity with information furnished or approved in writing by the Trading
Advisor.
(g) The accountants who certified the financial statements
filed with the SEC as part of the Registration Statement are, with respect to
the General Partner and the Partnership, independent public accountants as
required by the 1933 Act and the SEC Regulations.
-3-
(h) The financial statements filed as part of the Registration
Statement and those included in the Prospectus present fairly the financial
positions of the Partnership and of the General Partner as of the dates
indicated, and said financial statements have been prepared in conformity with
generally accepted accounting principles (as described therein).
(i) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not been any
material adverse change in the condition, financial or otherwise, business or
prospects of the General Partner or the Partnership, whether or not arising in
the ordinary course of business.
(j) The General Partner will have a net worth at the Closing
sufficient in amount and satisfactory in form to meet the net worth requirements
set forth in the Limited Partnership Agreement, or as otherwise set forth in the
opinion of Cadwalader, Xxxxxxxxxx & Xxxx, counsel for the General Partner, for
classification of the Partnership as a partnership for federal income tax
purposes.
(k) The Limited Partnership Agreement, the Management
Agreement and this Agreement have each been duly and validly authorized,
executed and delivered by the General Partner on behalf of the Partnership and
the General Partner and each constitutes a valid, binding and enforceable
agreement of the Partnership and of the General Partner in accordance with its
terms. The Escrow Agreement has been duly and validly authorized, executed and
delivered by the General Partner on behalf of the Partnership and constitutes a
valid, binding and enforceable agreement of the Partnership in accordance with
its terms. The Customer Agreement has been duly and validly authorized, executed
and delivered by the General Partner on behalf of the Partnership.
(l) The execution and delivery of the Limited Partnership
Agreement, the Escrow Agreement, the Customer Agreement, the Management
Agreement, and this Agreement, the incurrence of the obligations set forth in
each of such agreements and the consummation of the transactions contemplated
therein and in the Registration Statement and Prospectus will not violate, or
constitute a breach of, or default under, the General Partner's certificate of
incorporation or bylaws, the Certificate of Limited Partnership, or the Limited
Partnership Agreement, or any agreement or instrument by which either the
General Partner or the Partnership is bound, or any order, rule, law or
regulation applicable to the General Partner or the Partnership of any court or
any governmental body or administrative agency or panel or self-regulatory
organization having jurisdiction over the General Partner or the Partnership.
(m) Except as set forth in the Prospectus, there has not been
in the five years preceding the date of the Prospectus and there is not pending
or, to the best of the General Partner's knowledge, threatened, any action, suit
or proceeding at law or in equity before or by any court or any governmental
body, any administrative agency, panel or self-regulatory organization to which
the General Partner or any General Partner Principal (as hereinafter defined) or
the Partnership is or was a party, or to which any of the assets of the
-4-
General Partner or the Partnership is or was subject, and neither the General
Partner nor any of the principals of the General Partner, as "principals" is
defined in CFTC Rule 4.10(e) ("General Partner Principals") has received any
notice of an investigation by the NFA, NASD, SEC or CFTC regarding
non-compliance by the General Partner, the General Partner Principals or the
Partnership with the 1933 Act, the Securities Exchange Act of 1934, as amended
(the "1934 Act"), SEC Regulations, any other federal securities laws, rules or
regulations, the CEAct, the CFTC Rules, or the Rules of the NASD or NFA which
would be material to an investor's decision to invest in the Partnership.
(n) The General Partner, and each principal of the General
Partner as defined in CFTC Rule 3.1(a), has all federal, state and foreign
governmental, regulatory and exchange approvals and licenses, and has effected
all filings and registrations with federal, state and foreign governmental
regulators and self-regulatory organizations required to conduct its business
and to act as described in the Registration Statement and Prospectus or required
to perform its obligations as described under the Limited Partnership Agreement,
the Customer Agreement, the Escrow Agreement the Management Agreement and this
Agreement, as applicable. The General Partner is registered as a commodity pool
operator under the CEAct and is a member of the NFA as a commodity pool
operator. The General Partner's principals identified in the Prospectus are all
of the General Partner Principals.
2. Representations and Warranties of the Commodity Broker. The
Commodity Broker represents and warrants to each of the other parties hereto, as
follows:
(a) The Commodity Broker is a corporation duly organized and
validly existing and in good standing under the laws of the State of Delaware
and is in good standing and qualified to do business in the State of New York
and in each other jurisdiction in which the nature or conduct of its business
requires such qualification and the failure to be duly qualified would
materially adversely affect the Commodity Broker's ability to perform its
obligations hereunder or under the Customer Agreement. The Commodity Broker has
full corporate power and authority to perform its obligations under the Customer
Agreement and this Agreement and to act as described in the Registration
Statement and Prospectus.
(b) As to the Commodity Broker and the "principals" of the
Commodity Broker as defined in CFTC Rule 4.10(e) (the "Commodity Broker
Principals"): (i) the Registration Statement and Prospectus are accurate and
complete in all material respects and contain all statements and information
required to be included therein under the 1933 Act, the SEC Regulations, the
CEAct, the CFTC Rules, and the rules of the NFA, (ii) the Registration Statement
does not contain any untrue statement of a material fact or omit to state a
material fact which is required to be stated therein or necessary to make the
statements therein not misleading as of its effective date, and (iii) the
Prospectus, at its date of issue and as of the Closing, did not and will not
contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in light of the circumstances under
which such statements were made, not misleading.
-5-
(c) The Commodity Broker and each principal of the Commodity
Broker, as defined in CFTC Rule 3.1(a), has all federal, state and foreign
governmental regulatory and self-regulatory approvals, licenses and memberships,
and has effected all filings and registrations with federal, state and foreign
governmental regulators and self-regulatory organizations required to conduct
its business and to act as described in the Registration Statement and
Prospectus or required to perform its obligations under the Customer Agreement
and this Agreement, as applicable. The Commodity Broker is registered as a
futures commission merchant under the CEAct and is a member of the NFA as a
futures commission merchant.
(d) The Customer Agreement and this Agreement have each been
duly authorized, executed and delivered by the Commodity Broker and each
constitutes a valid and binding agreement of the Commodity Broker enforceable in
accordance with their respective terms.
(e) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as may otherwise
be stated in or contemplated by the Registration Statement and the Prospectus,
there has not been any material adverse change in the condition, financial or
otherwise, business or prospects of the Commodity Broker, whether or not arising
in the ordinary course of business.
(f) Except as set forth in the Registration Statement or
Prospectus, there has not been in the five years preceding the date of the
Prospectus and there is not pending, or, to the best of the Commodity Broker's
knowledge, threatened, any action, suit or proceeding before or by any court,
governmental body, administrative agency, panel, or self-regulatory organization
to which the Commodity Broker or any Commodity Broker Principal is or was a
party, or to which any of the assets of the Commodity Broker is or was subject
and which resulted in or might reasonably be expected to result in any material
adverse change in the condition, financial or otherwise, business or prospects
of the Commodity Broker or which would be material to an investor's decision to
invest in the Partnership. Neither the Commodity Broker nor any Commodity Broker
Principal has received any notice of an investigation by the NFA or the CFTC
regarding noncompliance by the Commodity Broker or the Commodity Broker
Principal with the CEAct, the CFTC Rules or the rules of the NFA.
(g) The execution and delivery of the Customer Agreement and
this Agreement, the incurrence of the obligations set forth in each of such
agreements and the consummation of the transactions contemplated therein and in
the Prospectus will not violate, or constitute a breach of, or default under,
the certificate of incorporation or bylaws of the Commodity Broker or any
agreement or instrument by which the Commodity Broker is bound, or any order,
law, rule or regulation applicable to the Commodity Broker of any court,
governmental body, administrative agency, panel or self-regulatory organization
having jurisdiction over the Commodity Broker.
-6-
3. Representations and Warranties of the Trading Advisor. The
Trading Advisor hereby represents and warrants to and agrees with DWR, the
Partnership and the General Partner as follows:
(a) The Trading Advisor is duly organized, validly existing
and in good standing as a corporation under the laws of the state of its
incorporation and is qualified to do business as a foreign corporation and in
good standing in each other jurisdiction in which the nature or conduct of its
business requires such qualification and the failure to so qualify would
materially adversely affect the Trading Advisor's ability to perform its duties
under this Agreement and the Management Agreement. The Trading Advisor has full
corporate power and authority to perform its obligations under each of such
agreements, and as described in the Registration Statement and Prospectus. The
only principals (as defined in CFTC Rule 4.10(e)) of the Trading Advisor are
those set forth in the Prospectus (the "Trading Advisor Principals").
(b) All references to the Trading Advisor and each Trading
Advisor Principal, including the Trading Advisor's trading approaches and
programs, in the Registration Statement and the Prospectus, and in the Sales
Literature which has been approved in writing by the Trading Advisor, are
accurate and complete in all material respects. With respect to the material
relating to the Trading Advisor and each Trading Advisor Principal, including
the Trading Advisor's and the Trading Advisor Principals' trading approaches and
programs, as applicable, (i) the Registration Statement and Prospectus contain
all statements and information required to be included therein under the 1933
Act, the SEC Regulations, the CEAct, the CFTC Rules and the rules of the NFA,
(ii) the Registration Statement does not contain any misleading or untrue
statement of a material fact or omit to state a material fact which is required
to be stated therein or necessary to make the statements therein not misleading,
and (iii) the Prospectus at its date of issue did not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in light of the circumstances under which such
statements were made, not misleading.
(c) The Management Agreement and this Agreement have each been
duly and validly authorized, executed and delivered on behalf of the Trading
Advisor and each constitutes a valid and binding agreement of the Trading
Advisor enforceable in accordance with its terms.
(d) The Trading Advisor and each "principal" of the Trading
Advisor, as defined in CFTC Rule 3.1(a), has all federal, state and foreign
governmental, regulatory, and self-regulatory approvals, licenses and
memberships and has effected all filings and registrations with federal, state
and foreign regulators and self-regulatory organizations required to conduct
business and to act as described in the Registration Statement and Prospectus or
required to perform its or his obligations under this Agreement and the
Management Agreement, as applicable. The Trading Advisor is registered as a
commodity trading advisor under the CEAct and is a member of the NFA as a
commodity trading advisor.
-7-
(e) The execution and delivery of the Management Agreement and
this Agreement, the incurrence of the obligations set forth in each of such
agreements, and the consummation of the transactions contemplated therein and in
the Prospectus will not violate, or constitute a breach of, or default under,
the certificate of incorporation or bylaws of the Trading Advisor or any
agreement or instrument by which it is bound or of any order, law, rule or
regulation of any court, governmental body, administrative agency, panel or
self-regulatory organization having jurisdiction over the Trading Advisor.
(f) The Trading Advisor is not required to be registered as an
investment adviser under the Investment Advisers Act of 1940, as amended, in
respect to its activities described in the Registration Statement and the
Prospectus.
(g) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as may otherwise
be stated in or contemplated by the Registration Statement and the Prospectus,
there has not been any material adverse change in the condition, financial or
otherwise, business or prospects of the Trading Advisor or any Trading Advisor
Principal whether or not arising in the ordinary course of business.
(h) Except as set forth in the Registration Statement or
Prospectus or as disclosed in writing to the General Partner, there has not been
in the five years preceding the date of the Prospectus and there is not pending,
or, to the best of the Trading Advisor's knowledge threatened, any action, suit
or, proceeding before or by any court, governmental body, administrative agency,
panel or self-regulatory organization to which the Trading Advisor or any
Trading Advisor Principal is or was a party, or to which any of the assets of
the Trading Advisor is or was subject and which resulted in or might reasonably
be expected to result in any material adverse change in the condition, financial
or otherwise, business or prospects of the Trading Advisor or which would be
material to an investor's decision to invest in the Partnership. Except as
otherwise disclosed in writing to the General Partner, neither the Trading
Advisor nor any Trading Advisor Principal has received any notice of an
investigation by the NFA or the CFTC regarding noncompliance by the Trading
Advisor or any of the Trading Advisor Principals with the CEAct, the CFTC Rules
or the rules of the NFA.
(i) Neither the Trading Advisor nor any Trading Advisor
Principal has received, or is entitled to receive, directly or indirectly, any
commission, finder's fee, similar fee, or rebate from any person in connection
with the organization or operation of the Partnership.
4. Covenants of the Partnership and the General Partner. The
Partnership and the General Partner covenant and agree as follows:
(a) The Partnership will use its best efforts to cause any
post-effective amendments to the Registration Statement to become effective as
promptly as possible. The Partnership will prepare and file with the SEC, NASD,
CFTC, and NFA,
-8-
promptly upon DWR's request, any amendments to the Registration Statement and
any amendments and supplements to the Prospectus which may be necessary or
advisable in connection with the offering and sale of Units and will use its
best efforts to cause the same to become effective as promptly as possible.
(b) As soon as the Partnership is advised or obtains knowledge
thereof, it will advise DWR and the Trading Advisor of any requests made by the
SEC, NASD, CFTC, or NFA to amend the Registration Statement, to amend or
supplement the Prospectus, or for additional information or of the issuance by
the SEC of any stop order suspending the effectiveness of the Registration
Statement, of any order by the SEC, NASD, CFTC, or NFA preventing or suspending
the use of the Prospectus, or of the institution of any proceedings for any such
purpose, and will use its best efforts to prevent the issuance of any such order
and, if any such order is issued, to obtain the lifting thereof as promptly as
possible.
(c) If, at any time after the effective date of the
Registration Statement and any amendment thereto, any event occurs involving the
Partnership or the General Partner or any of their principals or of which the
Partnership or the General Partner or their principals are aware, as a result of
which the Registration Statement or Prospectus as then amended and supplemented
would include any untrue statement of a material fact or any omission to state a
material fact required to be stated therein or necessary to make the statements
therein (and, with respect to the Prospectus, in light of the circumstances
under which they were made) not misleading, or if it becomes necessary or
desirable at any time to amend or supplement the Registration Statement or
Prospectus to comply with the 1933 Act, the SEC Regulations, the CEAct, the CFTC
Rules, or the rules of the NFA, the Partnership will promptly notify DWR and the
Trading Advisor thereof and will prepare and file with the SEC, NASD, CFTC, and
NFA an amendment or supplement that will correct such statement or omission.
(d) The Partnership will furnish to each party hereto copies
of the Registration Statement, the Prospectus, and all amendments and
supplements thereto, in each case as soon as available and, in the case of DWR,
in such quantities (in the case of the Prospectus) as DWR may reasonably request
for delivery to it.
5. Covenants of the Trading Advisor. The Trading Advisor covenants
and agrees as follows:
(a) The Trading Advisor agrees reasonably to cooperate by
providing information regarding itself in the preparation by the Partnership of
any amendments or supplements to the Registration Statement and the Prospectus.
(b) The Trading Advisor agrees to notify the General Partner
immediately upon discovery of any untrue statement of a material fact in the
Registration Statement or the Prospectus relating to the Trading Advisor or the
Trading Advisor
-9-
Principals or an omission to state a material fact relating to the Trading
Advisor or the Trading Advisor Principals required to be stated therein or
necessary to make the statements therein (and, with respect to the Prospectus,
in light of the circumstances under which they were made) not misleading, or of
the occurrence of any event or change in circumstances which would result in
there being any material untrue or misleading statement or a material omission
in the Prospectus or Registration Statement regarding the Trading Advisor or the
Trading Advisor Principals, or which would result in the Prospectus not
including all material information relating to the Trading Advisor and the
Trading Advisor Principals required pursuant to the CEAct, the 1933 Act, the
CFTC Rules, or the rules of the NFA.
(c) The Trading Advisor will not use or distribute any
preliminary prospectus, Prospectus, amended or supplemented Prospectus or Sales
Literature nor engage in any selling activities whatsoever in connection with
the offering of the Units, except that the Trading Advisor shall, at the General
Partner's request, assist in the marketing of the Partnership to prospective
investors, including without limitation participating in "road show"
presentations, sales seminars, and other similar events in which the Trading
Advisor shall discuss only its own activities.
6. Appointment of the Selling Agent.
(a) Subject to the terms and conditions set forth in this
Agreement, the Partnership hereby appoints DWR as its selling agent to offer and
sell Units on a best efforts basis, without any firm commitment on the part of
DWR to purchase any Units. DWR shall offer for sale up to 50,000 Units, and such
additional Units as the General Partner may, in its discretion, register and
offer for sale from time to time.
(b) The "Offering Period" will be the period commencing on the
date of the Prospectus and ending on October 10, 1997 unless the General Partner
has sooner terminated the Offering Period. DWR will offer Units for sale at a
closing (the "Closing"), which is currently scheduled to be held as of October
1, 1997, at a price equal to 100% of the of the Net Asset Value per Unit as of
the close of business on the last day of the immediately preceding month;
provided, however, that the General Partner may at its discretion hold the
Closing as of the first business day of any month during the Offering Period (as
defined herein). The minimum subscription for new subscribers shall be $5,000,
except that the minimum subscription is (a) $2,000 in the case of an Individual
Retirement Account ("XXX"), (b) $1,000 if the subscriber previously invested at
least $5,000, or $2,000 in the case of IRAs, in the Partnership, or (c) for
subscribers who purchase Units pursuant to an Exchange (as defined in the
Prospectus) the lesser of (i) $5,000 ($2,000 in the case of IRAs), (ii) the
redemption proceeds from the sale of five units (two units in the case of IRAs)
from commodity pools other than the Spectrum Series, (iii) the proceeds from the
redemption of 500 units (200 units in the case of IRAs) from one, or any
combination, of the Spectrum Series of commodity pools, or (iv) the proceeds
from the redemption of all of a subscriber's units of limited partnership
interest in any other commodity pool for which the General Partner serves as
general partner and commodity pool operator. The number of Units received by a
subscriber will be rounded to the third decimal place.
-10-
Notwithstanding any provision to the contrary herein,
the General Partner will have the sole discretion to accept or reject any
subscription for Units in whole or in part at any time prior to acceptance. The
General Partner will determine to accept or reject a subscription generally
within 10 days of the receipt of a complete and executed Subscription and
Exchange Agreement and Power of Attorney.
(c) No selling commissions will be charged with respect to the
sale of Units during the Offering Period. The Partnership understands, however,
that from DWR's own funds it may provide to its employees an amount equal to
that described in the following paragraph.
(d) Except as provided below, employees of DWR will receive
gross sales credit equal to three percent (3%) of the Net Asset Value per Unit
as of the date of the Closing for each Unit sold by them and issued at the
Closing (such compensation along with any other underwriting compensation will
not exceed 10% of the proceeds received in connection with the issuance of the
Units). Commencing with the eighth month following the Closing at which Units
are issued and continuing until the Partnership terminates, employees of DWR who
are properly registered with the CFTC also will receive up to 35% of the
brokerage commissions that are attributable to outstanding Units sold by them
and received by DWR as commodity broker for the Partnership. Such continuing
compensation is to be paid in recognition of employees' continuing services to
Limited Partners of the Partnership. No person will receive the continuing
compensation described above who is not DWR's employee at the time of receipt of
payment.
DWR will not pay to an employee the 3% gross sales
credit described above with respect to Units purchased by a subscriber pursuant
to an Exchange (as defined in the Prospectus). Such employee will receive the
continuing payments with respect to brokerage commissions which are charged to
the Partnership which are comparable to the payments which were received by such
employee with respect to such other commodity pools.
(e) Notwithstanding the foregoing, DWR will not pay any such
continuing compensation to any of its employees who is not legally qualified or
permitted to receive such continuing compensation. In that regard, each of DWR's
employees who receives any such monthly compensation must have become registered
as an associated person with the CFTC and with the NFA in such capacity only
after either having passed the National Commodity Futures Examination (NASD Test
Series #3), the Futures Managed Funds Examination (NASD Test Series #31) or
having been "grandfathered" under the CEAct and the bylaws and rules of the NFA.
Also, such compensation may be paid by DWR to its employees only in respect of
outstanding Units sold by such persons and only so long as the additional
services described below are provided by such persons to Limited Partners;
provided, however, that DWR may not pay any portion of such compensation to any
individual no longer employed by it, and provided, further, that such
compensation may be paid to its employees who, although not responsible for the
sale of an outstanding Unit,
-11-
provide the services described below in place of the individual who was
responsible for such sale.
The additional services that DWR's employees will
provide on an ongoing basis to Limited Partners at no charge will include, but
not be limited to: (i) inquiring of the General Partner from time to time, at
the request of Limited Partners, as to the Net Asset Value of a Unit; (ii)
inquiring of the General Partner from time to time, at the request of Limited
Partners, as to the futures markets and the activities of the Partnership; (iii)
responding to questions of Limited Partners from time to time with respect to
monthly account statements, annual reports, financial statements, and annual tax
information furnished periodically to Limited Partners; (iv) providing advice to
Limited Partners from time to time as to when and whether to redeem Units; (v)
assisting Limited Partners from time to time in the redemption of Units; and
(vi) providing such other services as Limited Partners from time to time may
reasonably request.
(f) The Partnership and DWR acknowledge that DWR will be paid
any and all redemption charges imposed on Limited Partners in accordance with
Section 10(b) of the Limited Partnership Agreement.
7. Undertakings of DWR.
(a) DWR agrees to use its best efforts to offer and sell Units
on the terms set forth in this Agreement, the Registration Statement, and the
Prospectus. It is understood that DWR has no commitment to offer and sell Units
or to purchase Units other than to use its best efforts to offer and sell Units.
(b) DWR will make the public offering of Units at the offering
price and on the other terms and conditions set forth in the Registration
Statement, the Prospectus, and this Agreement. DWR will offer and sell Units
only to persons who satisfy the suitability and/or minimum investment
requirements set forth in the Prospectus and the Subscription and Exchange
Agreement and Power of Attorney and who, to the General Partner's satisfaction,
complete a Subscription and Exchange Agreement and Power of Attorney. DWR will
conduct a thorough review of the suitability of each subscriber for Units, of
each Subscription and Exchange Agreement and Power of Attorney (i) authorizing
the General Partner and DWR to transfer the full subscription price from the
subscriber's customer account with DWR to the Xxxx Xxxxxx Portfolio Strategy
Fund L.P. Escrow Account (the "Escrow Account"), and (ii) requesting the
redemption of units in another partnership of which the General Partner is the
general partner and commodity pool operator and authorizing the purchase of
Units with the proceeds of such redemption.
All of DWR's branch offices will be required to forward
subscriptions to DWR's New York, New York branch office no later than noon of
the first business day following their receipt of an acceptable Subscription and
Exchange Agreement and Power of Attorney from a subscriber for Units. Subsequent
to its review of each Subscription and Exchange Agreement and Power of Attorney,
the General Partner will notify
-12-
DWR, and DWR shall notify each subscriber by the business day following its
receipt of notice from the General Partner, of the General Partner's acceptance
of all, a portion, or none of the subscriber's subscription.
All funds from subscriptions received by DWR during the
Offering Period and not rejected by the General Partner will be promptly
deposited by DWR in the Partnership's Escrow Account which will have been
established with the Escrow Agent. The escrow arrangements are described in the
Prospectus and in the Escrow Agreement to which DWR is a party along with the
Escrow Agent and the Partnership. A subscriber whose Subscription and Exchange
Agreement and Power of Attorney is received by DWR and not immediately rejected
must have the full subscription amount in his customer account with DWR on the
first business day following the date that his Subscription and Exchange
Agreement and Power of Attorney is received by DWR, and DWR will transfer such
subscription funds to the Escrow Agent on that date. DWR will notify the General
Partner of the subscription amount deposited with the Escrow Agent on behalf of
each subscriber for Units and the name and residence address of each such
subscriber.
DWR will offer and sell Units in compliance with the
requirements set forth in the Registration Statement, the Prospectus
(particularly under the captions "Summary of the Prospectus -- Investment
Requirements," "Purchases by Employee Benefit Plans -- ERISA Considerations,"
"Plan of Distribution," and "Subscription Procedure"), the Subscription and
Exchange Agreement and Power of Attorney, and this Agreement. In connection with
DWR's acting as selling agent, DWR will comply fully at all times with all
applicable federal, state, and foreign securities and commodities laws
(including, without limitation, the 1933 Act, the 1934 Act, the CEAct and the
securities ("Blue Sky") laws of the jurisdictions in which DWR solicits
subscriptions), and all requirements of the NASD (particularly Conduct Rule
2810), the Board of Governors of the Federal Reserve System, and the securities
and commodities exchanges and other governmental and self-regulatory authorities
and organizations having jurisdiction over DWR. Specifically, (i) DWR will not
permit the purchase of any Units by a customer account over which DWR has
discretionary authority without prior written approval by the customer owning
such account; (ii) DWR confirms that it has reasonable grounds to believe that
all material facts are adequately and accurately disclosed in the Prospectus,
which provides a basis for evaluating an investment in the Partnership; (iii)
DWR confirms that in determining the adequacy of disclosed facts pursuant to
clause (ii), it has obtained information on material facts relating to: (A)
items of compensation, (B) tax aspects, (C) financial stability and experience
of the General Partner, and (D) the Partnership's conflicts and risk factors;
(iv) in recommending to a subscriber the purchase or sale of Units, DWR shall
take such measures as are reasonably necessary to assure itself that its Account
Executives have informed such subscriber of all pertinent facts relating to the
liquidity and marketability of the Units and that its Account Executives have
reasonable grounds to believe, on the basis of information obtained from such
subscriber concerning his investment objectives, other investments, financial
situation and needs, and any other information known by such Account Executive,
that: (A) such subscriber is or will be in a financial position appropriate to
enable him to realize to a
-13-
significant extent the benefits described in the Prospectus, (B) such subscriber
has a fair market net worth sufficient to sustain the risks inherent in the
purchase of Units, including loss of investment and lack of liquidity, and (C)
the purchase of Units is otherwise suitable for such subscriber; (v) DWR shall
take such measures as are reasonably necessary to assure itself that each
subscriber has received a Prospectus at least five days prior to the Closing;
and (vi) the General Partner will maintain in its files, located c/o Xxxx Xxxxxx
Xxxxxxxx Inc., Xxx Xxxxx Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, each
subscriber's Subscription and Exchange Agreement and Power of Attorney for not
less than six years and DWR will maintain, at its respective branch offices, any
other documents disclosing the basis upon which the determination of suitability
was reached for each such subscriber.
(c) If for any reason the General Partner determines not to
hold the Closing, the offering of Units will terminate and each subscription
received during the Offering Period will be promptly returned to DWR for deposit
in the subscriber's customer account with DWR within five business days of the
termination of the Offering Period, together with any interest earned on such
subscriber's funds while held in escrow in accordance with the Escrow Agreement,
and DWR will promptly notify each subscriber that such subscription has been
returned to such subscriber's customer account with DWR and that such funds are
under such subscriber's control.
All subscriptions received and accepted by the General
Partner will, upon the satisfaction at the Closing of the conditions set forth
in Sections 10 and 11 hereof, be delivered to the Partnership at the Closing,
and any interest earned on a subscriber's subscription funds while held in
escrow will be promptly returned to DWR in accordance with the Escrow Agreement
for prompt deposit in the subscriber's customer account with DWR. Interest
earned on any subscriptions deposited into the Escrow Account and thereafter
rejected by the General Partner will be credited to the subscriber's customer
account with DWR.
8. Blue Sky Filings. The Partnership will use its best efforts to
qualify Units for offer and sale under the Blue Sky laws of such jurisdictions
as DWR may reasonably request, to make applications, file documents, and furnish
information as may be reasonably required for that purpose, and to comply with
such laws so as to permit the continuance of sales and dealings in such
jurisdictions for as long as may be necessary to complete the offer and sale of
Units, provided, however, that neither the Partnership nor the General Partner
will be required to qualify as or be subject to taxation as a foreign
partnership or corporation or to execute a general consent to service of process
in any jurisdiction. The Partnership further agrees that its counsel will
prepare and deliver to DWR Blue Sky surveys which will set forth, for DWR's
guidance, in what manner, at what time, in what amounts, and by whom Units may
be offered and sold in jurisdictions requested by DWR as provided above.
9. Offering Expenses. DWR shall pay all of the expenses of the
offering of Units (collectively, the "Offering Expenses"), including all legal
and accounting fees and expenses of outside firms and all costs, disbursements,
filing fees, printing and duplication
-14-
costs, marketing costs and expenses and other related costs and expenses. Legal
and accounting fees and expenses of outside firms shall include the legal and
accounting expenses relating to the offering of Units of DWR, the Partnership
and the General Partner. Marketing costs and expenses shall include, but not be
limited to, the printing and preparation of Sales Literature, the production of
any sales video, and the staging of sales seminars and the travel of DWR and
General Partner personnel associated therewith. DWR shall not be reimbursed for
such expenses by the Partnership. Such expenses will not include the travel,
legal and other expenses of the Trading Advisor, including such expenses
incurred in connection with the participation by the Trading Advisor in road
shows as described in Section 5(c).
10. Closings.
(a) The Closing, if any, for the acceptance of subscriptions
for Units received during the Offering Period is currently scheduled to be held
as of October 1, 1997. The Closing will be held at such time and at such
location as the General Partner and DWR may mutually agree.
(b) Subject to its right to reject any subscription in its
sole discretion in whole or in part at any time prior to acceptance, the General
Partner, on behalf of the Partnership, will accept subscriptions for Units
properly made and cause proper entry to be made in the Unit register to be
maintained by the General Partner. DWR will cause a receipt to be made on behalf
of subscribers for Units accepted by the General Partner at the Closing and
shall send such subscribers a confirmation of purchase in its customary form.
(c) At the Closing, the delivery, receipt, and acceptance of
subscriptions for Units will be subject to the terms and conditions set forth in
this Agreement, including the following: (i) payment of the full subscription
price for Units and delivery of a properly completed Subscription and Exchange
Agreement and Power of Attorney by each subscriber, and (ii) compliance with
Section 11 hereof. Upon the satisfaction of such terms and conditions, the
aggregate subscription price for Units (exclusive of any interest earned on such
subscriptions while held in escrow and payable to the subscribers in accordance
with the Escrow Agreement) will be paid and delivered to the Partnership at the
Closing.
11. Conditions of DWR's Obligations.
(a) DWR's obligations to proceed with the offering and sale of
Units and the Closing will be subject to: (i) the accuracy of the
representations and warranties by the Partnership, the General Partner and the
Trading Advisor in this Agreement as of the date hereof and as of the date of
the Closing as if such representations and warranties had been made on and as of
the date thereof; (ii) the performance by the Partnership, the General Partner
and the Trading Advisor of the covenants and agreements herein; and (iii) to the
additional conditions precedent set forth below.
(b) At the Closing, the additional conditions precedent are as
follows, unless waived by DWR:
-15-
(i) The Registration Statement will have become effective. No stop
order suspending the effectiveness of the Registration Statement will have
been issued and no proceedings for that purpose will have been instituted
or be pending or, to the knowledge of the Partnership or DWR, contemplated
or threatened by the SEC. No order preventing or suspending the use of the
Prospectus will have been issued and no proceedings for that purpose will
have been instituted or be pending or, to the knowledge of the Partnership
or DWR, contemplated or threatened by the SEC, NASD, CFTC, or NFA. Any
requests by the SEC, NASD, CFTC, or NFA for additional information (to be
included in the Registration Statement or Prospectus or otherwise) will
have been complied with to DWR's satisfaction.
(ii) Neither DWR nor the Trading Advisor will have advised the
Partnership or the General Partner that, in its opinion, the Registration
Statement or the Prospectus contains any untrue statement of a material
fact or any omission of a material fact required to be stated therein or
necessary to make the statements therein (in the case of the Prospectus,
in light of the circumstances under which they were made) not misleading.
(iii) The Trading Advisor will have furnished to DWR, the General
Partner and the Partnership a certificate, dated the date of the Closing
and in form and substance satisfactory to such parties, to the effect
that:
(A) The representations and warranties by the Trading Advisor
in this Agreement are true, accurate, and complete on and as of the
date of the Closing as if made on the date of the Closing.
(B) The Prospectus, at the date of the Closing, does not
contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in light of
the circumstances under which such statements were made, not
misleading.
(C) The Trading Advisor has performed all of its obligations
and satisfied all of the conditions on its part to be performed or
satisfied under this Agreement, as applicable, as of the date of the
Closing.
(iv) The General Partner will have furnished to DWR and the Trading
Advisor a certificate, dated the date of the Closing and in form and
substance satisfactory to such parties, to the effect that:
(A) The representations and warranties by the Partnership and
the General Partner in this Agreement are true,
-16-
accurate, and complete on and as of the date of the Closing as if
made on the date of the Closing.
(B) No stop order suspending the effectiveness of the
Registration Statement has been issued by the SEC and no proceedings
for that purpose have been instituted or are pending or, to the
knowledge of the General Partner, are contemplated or threatened
under the 1933 Act. No order preventing or suspending the use of the
Prospectus has been issued by the SEC, NASD, CFTC, or NFA and no
proceedings for that purpose have been instituted or are pending or,
to the knowledge of the General Partner, are contemplated or
threatened under the 1933 Act or the CEAct.
(C) The Partnership and the General Partner have performed all
of their obligations and satisfied all of the conditions on their
part to be performed or satisfied under this Agreement, the
Management Agreement, the Escrow Agreement and the Customer
Agreement at or prior to the date of the Closing.
(D) The General Partner has made the capital contribution to
the Partnership and has met the net worth standard, both as required
of it by the Limited Partnership Agreement.
(v) Cadwalader, Xxxxxxxxxx & Xxxx, counsel to the General Partner
and the Partnership, shall deliver its opinion to the parties hereto at
the Closing, in form and substance satisfactory to the parties hereto, to
the effect that:
(A) The Limited Partnership Agreement provides for the
subscription for and sale of the Units; all action required to be
taken by the General Partner and the Partnership as a condition to
the subscription for and sale of the Units to qualified subscribers
therefor has been taken; and, upon payment of the consideration
therefor specified in the accepted Subscription and Exchange
Agreements and Powers of Attorney, the Units will constitute valid
limited partnership interests in the Partnership and each subscriber
who purchases Units will become a Limited Partner, subject to the
requirement that each such purchaser shall have duly completed,
executed and delivered to the Partnership a Subscription and
Exchange Agreement and Power of Attorney relating to the Units
purchased by such purchaser, that such purchaser meets all
applicable suitability standards and that the representations and
warranties of such purchaser in the
-17-
Subscription and Exchange Agreement and Power of Attorney are true
and correct and that such purchaser is included as a Limited Partner
in the Partnership's records.
(B) The Partnership is a limited partnership duly formed
pursuant to the Certificate of Limited Partnership, the Limited
Partnership Agreement and the DRULPA and is validly existing under
the laws of the State of Delaware with full partnership power and
authority to conduct the business in which it proposes to engage as
described in the Registration Statement and Prospectus and to
perform its obligations under the Management Agreement, the Escrow
Agreement, the Customer Agreement and this Agreement; the
Partnership has received a Certificate of Authority as contemplated
under Section 121-902 of the New York Revised Limited Partnership
Act and is qualified to do business in New York and need not affect
any other filings or qualifications under the laws of any other
jurisdictions to conduct its business as described in the
Registration Statement and Prospectus.
(C) The General Partner is duly organized, validly existing
and in good standing as a corporation under the laws of the State of
Delaware with full corporate power and authority to act as general
partner of the Partnership and is qualified to do business and is in
good standing as a foreign corporation in the State of New York and
in each other jurisdiction in which the nature or conduct of its
business requires such qualification and the failure to so qualify
might reasonably be expected to result in material adverse
consequences to the Partnership or the General Partner's ability to
perform its obligations as described in the Registration Statement
and Prospectus. The General Partner has full corporate power and
authority to conduct its business as described in the Registration
Statement and Prospectus and to perform its obligations under the
Limited Partnership Agreement, the Management Agreement, and this
Agreement.
(D) The General Partner, each of its principals as defined in
CFTC Rule 3.1(a) and the Partnership have all federal and state
governmental, regulatory and self-regulatory approvals, licenses,
registrations and memberships required by law and have made all
filings with federal and state governmental regulators and
self-regulatory organizations necessary in order for the General
Partner and the Partnership to perform their obligations under the
Limited Partnership Agreement, the Escrow
-18-
Agreement, the Customer Agreement, the Management Agreement and this
Agreement, and to conduct their business as described in the
Registration Statement and Prospectus, except for such approvals,
licenses, memberships, filings, and registrations the absence of
which would not have a material adverse effect on their ability to
act as described in the Registration Statement and Prospectus, or to
perform their obligations under such agreements, and, to the best of
such counsel's knowledge, after due investigation, none of such
approvals, licenses, memberships or registrations have been
rescinded, revoked or suspended.
(E) Each of the Limited Partnership Agreement, the Escrow
Agreement, the Customer Agreement, the Management Agreement and this
Agreement has been duly authorized, executed and delivered by or on
behalf of the General Partner and/or the Partnership, as the case
may be, and each of the Limited Partnership Agreement, the
Management Agreement, and this Agreement constitutes a valid and
binding agreement of the General Partner and the Partnership, and
the Escrow Agreement constitutes a valid and binding agreement of
the Partnership, and, in the case of each valid and binding
agreement above, the agreement is enforceable in accordance with its
terms, subject to bankruptcy, insolvency, reorganization, moratorium
or similar laws at the time in effect affecting the enforceability
generally of rights of creditors and by general principals of equity
(regardless of whether such enforceability is considered in a
proceeding in equity or at law), and except as enforceability of the
indemnification, exculpation and contribution provisions contained
in such agreements may be limited by applicable law or public
policy.
(F) The execution and delivery of this Agreement, the Limited
Partnership Agreement, the Customer Agreement, the Escrow Agreement,
and the Management Agreement, as applicable, and the offer and sale
of the Units by the Partnership and the incurrence of the
obligations herein and therein set forth and the consummation of the
transactions contemplated herein and therein and in the Prospectus
will not be in contravention of the General Partner's certificate of
incorporation or bylaws, the Certificate of Limited Partnership, or
the Limited Partnership Agreement and, to the best of such counsel's
knowledge based upon due inquiry of certain officers of the General
Partner, will not constitute a breach of, default under, or a
violation of any
-19-
agreement or instrument known to such counsel by which the General
Partner or the Partnership is bound, and will not violate any order,
law, rule or regulation applicable to the General Partner or the
Partnership of any court, governmental body, administrative agency,
panel or self-regulatory organization having jurisdiction over the
General Partner or the Partnership.
(G) To the best of such counsel's knowledge based upon due
inquiry of certain officers of the General Partner, except as
disclosed in the Prospectus, there are no actions, claims or
proceedings pending or threatened in any court or before or by any
governmental body, administrative agency, panel or self-regulatory
organization, nor have there been any such actions, claims or
proceedings within the five years preceding the date of the
Prospectus, to which the General Partner, any General Partner
Principal, or the Partnership is or was a party, or to which any of
their assets is or was subject, which would be material to an
investor's decision to invest in the Partnership or which might
reasonably be expected to materially adversely affect the condition,
financial or otherwise, or business of the General Partner, or the
Partnership, whether or not arising in the ordinary course of
business, or impair their ability to discharge their obligations as
described in the Prospectus.
(H) No authorization, approval or consent of any governmental
authority or agency (with respect to the Partnership and General
Partner) is necessary in connection with the subscription for and
sale of the Units in the United States, except such as may be
required under the 1933 Act, the SEC Regulations, the CEAct, the
CFTC Rules, the NFA and NASD rules and Blue Sky laws.
(I) The information in the Prospectus under the captions "Risk
Factors - Taxation and Regulatory Risks," "Purchases by Employee
Benefit Plans -- ERISA Considerations," "Material Federal Income Tax
Considerations," "State and Local Income Tax Aspects," and "The
Limited Partnership Agreement," to the extent that such information
constitutes matters of law or legal conclusions, has been reviewed
by such counsel and is correct.
(J) The Registration Statement is effective under the 1933 Act
and, to the best of such counsel's knowledge, no
-20-
proceedings for a stop order are pending or threatened under Section
8(d) of the 1933 Act or any Blue Sky laws.
(K) At the time the Registration Statement became effective,
the Registration Statement, and at the time the Prospectus was
issued and as of the Closing, the Prospectus, complied as to form in
all material respects with the requirements of the 1933 Act, the SEC
Regulations, the CEAct, the CFTC Rules, and the rules of the NFA and
NASD. Nothing has come to such counsel's attention that would lead
such counsel to believe that the Registration Statement at the time
it became effective contained any untrue statement of a material
fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading,
or that the Prospectus at the time it was issued or at the Closing
contained an untrue statement of a material fact or omitted to state
a material fact necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading;
provided, however, that Cadwalader, Xxxxxxxxxx & Xxxx need express
no opinion or belief (a) as to information in the Registration
Statement or the Prospectus regarding the Trading Advisor or its
principals, or (b) as to the financial statements, notes thereto and
other financial or statistical data set forth in the Registration
Statement and Prospectus, except that Cadwalader, Xxxxxxxxxx & Xxxx
shall opine, without rendering any opinion as to the accuracy of the
information in the performance data, that the performance data of
the Partnership set forth in the Prospectus complies as to form in
all material respects with the CEAct and CFTC Rules, except as
disclosed in the Prospectus.
(L) Based upon reliance on certain SEC No-Action letters, as
of the Closing, the Partnership need not register as an "investment
company" under the Investment Company Act of 1940, as amended.
In rendering its opinion, such counsel may rely on information
obtained from public officials, officers of the General Partner and other
sources believed by it to be responsible and may assume that signatures on all
documents examined by it are genuine, and that a Subscription and Exchange
Agreement and Power of Attorney, in the form referred to in the Prospectus, has
been duly authorized, completed, dated, executed, and delivered and that funds
representing the full subscription price for the Units purchased have been
delivered by each purchaser of Units in accordance with the requirements set
forth in the Prospectus.
-21-
(vi) Cadwalader, Xxxxxxxxxx & Xxxx shall deliver an opinion to the
parties hereto at the Closing, in form and substance satisfactory to the
parties hereto, to the effect that:
(A) The Commodity Broker is duly organized, validly existing
and in good standing as a corporation under the laws of the State of
Delaware and is qualified to do business and in good standing as a
foreign corporation in the State of New York and in each other
jurisdiction in which such qualification is required and in which
the failure to so qualify might, in such counsel's opinion,
reasonably be expected to result in material adverse consequences to
the Partnership. The Commodity Broker has full corporate power and
authority to perform its obligations as commodity broker as
described in the Registration Statement and Prospectus and to
perform its obligations under the Customer Agreement and this
Agreement.
(B) Each of the Customer Agreement and this Agreement has been
duly and validly authorized, executed and delivered by the Commodity
Broker and constitutes a valid and binding agreement of the
Commodity Broker enforceable in accordance with its terms, subject
only to bankruptcy, insolvency, reorganization, moratorium or
similar laws at the time in effect affecting the enforceability
generally of rights of creditors and by general principals of equity
(regardless of whether such enforceability is considered in a
proceeding in equity or at law), and except as enforceability of the
indemnification, exculpation and contribution provisions contained
in such agreements may be limited by applicable law or public
policy.
(C) The Commodity Broker has all federal and state
governmental, regulatory, and self-regulatory approvals, licenses,
registrations and memberships required by law and has made all
filings with federal and state governmental regulators and
self-regulatory organizations required to conduct its business as
commodity broker as described in the Registration Statement,
Customer Agreement and Prospectus, or required to perform its
obligations as commodity broker under the Customer Agreement and
this Agreement, except for such approvals, licenses, memberships,
filings, and registrations the absence of which would not have a
material adverse effect on its ability to act as described in the
Registration Statement and Prospectus or to perform its obligations
under such agreements (except that counsel need not opine as to
exchange or clearinghouse
-22-
membership) and, to the best of such counsel's knowledge after due
investigation, none of such approvals, licenses, memberships, or
registrations have been rescinded, revoked or suspended.
(D) The execution and delivery of the Customer Agreement and
this Agreement, the incurrence of the obligations as commodity
broker herein and therein set forth and the consummation of the
transactions as commodity broker contemplated herein and therein and
in the Prospectus will not be in contravention of its certificate of
incorporation or bylaws and, to the best of such counsel's knowledge
based upon due inquiry of certain officers of the Commodity Broker,
will not constitute a breach of, default under, or a violation of
any agreement or instrument known to such counsel by which the
Commodity Broker is bound, and will not violate any order, law, rule
or regulation applicable to the Commodity Broker of any court,
governmental body, administrative agency, panel or self-regulatory
organization having jurisdiction over the Commodity Broker.
(E) To the best of such counsel's knowledge based upon due
inquiry of certain officers of the Commodity Broker, except as
disclosed in the Prospectus, there are no actions, claims or
proceedings pending or threatened in any court or before or by any
governmental body, administrative agency, panel or self-regulatory
organization, nor have there been any such actions, claims or
proceedings within the five years preceding the date of the
Prospectus, to which the Commodity Broker or any Commodity Broker
Principal is or was a party or to which any of its assets is or was
subject, which would be material to an investor's decision to invest
in the Partnership or which might reasonably be expected to
materially adversely affect the condition, financial or otherwise,
or the business of the Commodity Broker, whether or not arising in
the ordinary course of business, or impair its ability to discharge
its obligations as described in the Prospectus.
(F) Nothing has come to such counsel's attention to lead such
counsel to believe that, as to the Commodity Broker in its role as
commodity broker and the Commodity Broker Principals, (a) the
Registration Statement at the time it became effective contained any
untrue statement of a material fact or omitted to state a material
fact required to be stated therein or
-23-
necessary to make the statements therein not misleading, or (b) the
Prospectus at the time it was issued or at the Closing contained an
untrue statement of a material fact or omitted to state a material
fact necessary to make the statements therein relating to the
Commodity Broker in its role as commodity broker and the Commodity
Broker Principals, in light of the circumstances under which they
were made, not misleading; provided, however, that counsel need
express no opinion or belief as to the financial statements, notes
thereto and other financial or statistical data set forth in the
Registration Statement and Prospectus, except that counsel shall
opine, without rendering any opinion as to the accuracy of the
information in the performance data, that the performance data of
the Trading Advisor set forth in the Prospectus complies as to form
in all material respects with the CEAct and CFTC Rules, except as
disclosed in the Prospectus.
In rendering its opinion, such counsel may rely on information
obtained from public officials, officers of the Commodity Broker, and other
sources believed by it to be responsible and may assume that signatures on all
documents examined by it are genuine.
(vii) Counsel to the Trading Advisor shall deliver an opinion to
DWR, the General Partner and the Partnership at the Closing in form and
substance satisfactory to such parties, in respect of the Trading Advisor,
to the effect that:
(A) The Trading Advisor is a corporation duly organized,
validly existing and in good standing under the laws of the state of
its incorporation and is qualified to do business as a foreign
corporation and in good standing in each other jurisdiction in which
the nature or conduct of its business requires such qualification
and the failure to be duly qualified would materially adversely
affect the Trading Advisor's ability to perform its obligations
under the Management Agreement and this Agreement. The Trading
Advisor has full corporate power and authority to conduct its
business as described in the Registration Statement and Prospectus
and to perform its obligations under the Management Agreement and
this Agreement.
(B) The Trading Advisor and the Trading Advisor Principals
have all governmental, regulatory and self-regulatory approvals,
licenses, registrations and memberships required by law, and the
Trading Advisor and the Trading Advisor Principals
-24-
have made all filings with federal and state governmental regulators
and self-regulatory organizations required to conduct the Trading
Advisor's business and to act as described in the Registration
Statement and the Prospectus and to perform its obligations under
this Agreement and the Management Agreement, except for such
licenses, memberships, filings and registrations the absence of
which would not have a material adverse effect on its ability to act
as described in the Registration Statement and Prospectus or to
perform its obligations under such agreements, and, to the best of
such counsel's knowledge after due investigation, none of such
approvals, licenses, memberships, or registrations has been
rescinded, revoked or suspended.
(C) Each of the Management Agreement and this Agreement has
been duly and validly authorized, executed and delivered by or on
behalf of the Trading Advisor and constitutes a valid and binding
agreement of the Trading Advisor enforceable in accordance with its
terms, subject only to bankruptcy, insolvency, reorganization,
moratorium or similar laws at the time in effect affecting the
enforceability generally of rights of creditors and by general
principals of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law), and except as
enforceability of the indemnification, exculpation, and contribution
provisions contained in such agreements may be limited by applicable
law or public policy.
(D) To the best of such counsel's knowledge based upon due
inquiry of certain officers of the Trading Advisor, except as
disclosed in the Prospectus or in writing to the General Partner
prior to the Closing, there are no material actions, claims or
proceedings at law or in equity threatened or pending in any court
or before or by any governmental body, administrative agency, panel
or self-regulatory organization, nor have there been any such
actions, claims or proceedings at any time within the five years
preceding the date of the Prospectus to which the Trading Advisor or
any Trading Advisor Principal is or was a party or to which any of
its assets is or was subject, which would be material to an
investor's decision to invest in the Partnership or which might
reasonably be expected to materially adversely affect the condition,
financial or otherwise, or the business of the Trading Advisor,
whether or not arising in the ordinary course of
-25-
business, or impair its ability to discharge its obligations as
described in the Prospectus.
(E) The execution and delivery of this Agreement and the
Management Agreement, the incurrence of the obligations herein and
therein set forth and the consummation of the transactions
contemplated herein, therein and in the Prospectus will not be in
contravention of any of the provisions of the certificate of
incorporation or bylaws of the Trading Advisor and, to the best of
such counsel's knowledge based upon due inquiry of certain officers
of the Trading Advisor, will not constitute a breach of, default
under, or a violation of any instrument or agreement known to such
counsel by which the Trading Advisor is bound, and will not violate
any order, law, rule or regulation applicable to the Trading Advisor
of any court, governmental body, administrative agency, panel or
self-regulatory organization having jurisdiction over the Trading
Advisor.
(F) Based upon reliance on certain SEC No-Action letters, as
of the Closing the performance by the Trading Advisor of its duties
contemplated by the Management Agreement and this Agreement and as
described in the Prospectus will not require the Trading Advisor to
be registered as an "investment adviser" as that term is defined in
the Investment Advisers Act of 1940, as amended.
(G) Nothing has come to such counsel's attention that would
lead them to believe that, (a) the Registration Statement at the
time it became effective, insofar as the Trading Advisor and the
Trading Advisor Principals are concerned, contained any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, or (b) the Prospectus at the time it was
issued or at the Closing contained an untrue statement of a material
fact or omitted to state a material fact necessary to make the
statements therein relating to the Trading Advisor or the Trading
Advisor Principals, in light of the circumstances under which they
were made, not misleading; provided, however, that such counsel need
express no opinion or belief as to the financial statements, notes
thereto and other financial or statistical data set forth in the
Registration Statement and Prospectus, except that such counsel
shall opine, without rendering any opinion as to the accuracy of the
information in the
-26-
performance data, that the performance data of the Trading Advisor
set forth in the Prospectus complies as to form in all material
respects with the CEAct and CFTC Rules, except as disclosed in the
Prospectus.
In giving the foregoing opinion, such counsel may rely on
information obtained from public officials, officers of the Trading Advisor, and
other sources believed by it to be responsible and may assume that signatures on
all documents examined by it are genuine.
(viii) Deloitte & Touche L.L.P., independent certified public
accountants for the Partnership and the General Partner, will have
furnished to DWR a letter, dated the date of the Closing and in form and
substance satisfactory to DWR, to the effect that:
(A) Such accountant is an independent certified public
accountant within the meaning of the 1933 Act, the CEAct, the SEC
Regulations and the CFTC Rules with respect to the Partnership and
the General Partner.
(B) In such accountant's opinion, the statements of financial
condition of the Partnership and the General Partner and the notes
thereto included in the Prospectus and examined by it comply as to
form in all material respects with the applicable accounting
requirements of the 1933 Act, the CEAct, and the SEC Regulations.
(C) On the basis of limited procedures not constituting an
audit, including inquiries of officials of the General Partner
having responsibility for financial and accounting matters
pertaining to the Partnership, and such other inquiries and
procedures as may be specified in such letter, nothing has come to
such accountant's attention which causes it to believe that, as of a
specified date not more than five business days prior to the date of
the Closing, there has been any decrease in the Net Assets of the
Partnership (as defined in the Limited Partnership Agreement) as
compared to Net Assets set forth in the statement of financial
condition of the Partnership included in the Prospectus, except as
may be disclosed in such letter.
(D) On the basis of limited procedures not constituting an
audit, including a reading of the latest available financial
statements of the General Partner, inspection of the minute book of
the General Partner since the date of the latest audited financial
statements of the General Partner, inquiries of officials of the
General Partner having responsibility for financial and
-27-
accounting matters, and such other inquiries and procedures as may
be specified in such letter, nothing has come to such accountant's
attention that causes it to believe that, as of a specified date not
more than five business days prior to the date of the Closing, there
has been any decrease in the General Partner's net worth as compared
to net worth set forth in the statement of financial condition of
the General Partner included in the Prospectus, except as may be
disclosed in such letter.
(ix) The Commodity Broker shall deliver a certificate to the parties
hereto, in form and substance satisfactory to such parties and dated the
date of the Closing, to the effect that the representations and warranties
of the Commodity Broker contained herein are true and correct with the
same effect as though expressly made at the Closing.
(x) All agreements contemplated herein or in the Registration
Statement or Prospectus shall have been duly executed and delivered.
12. Indemnification.
(a) The Trading Advisor agrees to indemnify, defend, and hold
harmless DWR, the Partnership, the General Partner, and their affiliates and
each of their officers, directors, principals, shareholders, controlling persons
and their respective successors and assigns from and against any loss, claim,
damage, liability, cost, and expense, joint and several or otherwise, to which
any indemnitee may become subject under the 1933 Act, the 1934 Act, the CEAct,
the Blue Sky law of any jurisdiction, or otherwise (including any reasonable
investigatory, legal, and other expense incurred in connection with, and any
amounts paid in, any settlement provided that the Trading Advisor shall have
approved such settlement, and in connection with any administrative
proceedings), in respect of the offer or sale of Units, insofar as such loss,
claim, damage, liability, cost, or expense (or action in respect thereof) arises
out of, or is based upon: (i) a breach by the Trading Advisor of any
representation, warranty, or agreement in this Agreement or any certificate
delivered pursuant to this Agreement or the failure by the Trading Advisor to
perform any covenant made by the Trading Advisor herein; (ii) a material
inaccuracy in the information relating to the Trading Advisor in any Sales
Literature approved in writing by the Trading Advisor; or (iii) a misleading or
untrue statement or alleged misleading or untrue statement of a material fact
made in the Registration Statement or the Prospectus, or an omission or alleged
omission to state a material fact therein which is required to be stated therein
or necessary to make the statements therein (in the case of the Prospectus, in
light of the circumstances under which they were made) not misleading, and such
statement or omission relates specifically to the Trading Advisor or the Trading
Advisor Principals, or was made in reliance upon, and in conformity with,
written information or instructions furnished by the Trading Advisor. The
Trading Advisor will also reimburse any indemnitee for any legal, accounting,
and other expense incurred by such indemnitee in connection with investigating
or defending any loss,
-28-
claim, damage, liability, cost, and expense covered by the indemnities in this
Section 12(a). This indemnity shall not relate to any matter for which the
Trading Advisor would be indemnified under paragraph (b) of this Section 12.
(b) The Partnership and the General Partner agree, jointly and
severally, to indemnify, hold harmless, and defend the Trading Advisor and each
of its officers, directors, principals, shareholders, controlling persons, and
its respective successors and assigns from and against any loss, claim, damage,
liability, cost, and expense, joint and several, to which any indemnitee may
become subject under the 1933 Act, the 1934 Act, the CEAct, the Blue Sky law of
any jurisdiction, or otherwise (including any reasonable investigatory, legal,
and other expense incurred in connection with, and any amounts paid in, any
settlement provided that the Partnership and the General Partner shall have
approved such settlement, and in connection with any administrative
proceedings), in respect of the offer or sale of Units, insofar as such loss,
claim, damage, liability, cost, or expense (or action in respect thereof) arises
out of, or is based upon: (i) a breach by the Partnership or the General Partner
of any representation, warranty, or agreement in this Agreement or any
certificate delivered pursuant to this Agreement or the failure by the
Partnership or the General Partner to perform any covenant made by either of
them herein; or (ii) a misleading or untrue statement or alleged misleading or
untrue statement of a material fact made in the Registration Statement, the
Prospectus, or the Sales Literature, or an omission or alleged omission to state
a material fact therein which is required to be stated therein or necessary to
make the statements therein (in the case of the Prospectus or the Sales
Literature, in light of the circumstances under which they were made) not
misleading, provided that such misleading or untrue statement or alleged
misleading or untrue statement or omission or alleged omission does not relate
to the Trading Advisor or the Trading Advisor Principals, or was not made in
reliance upon, and in conformity with, information or instructions furnished by
the Trading Advisor (provided, however, that with respect to any Sales
Literature, the Partnership and the General Partner shall not be under an
indemnification obligation only with respect to such Sales Literature as shall
have been approved in writing by the Trading Advisor), or does not result from a
breach by the Trading Advisor of any representation, warranty, or agreement in
this Agreement or any certificate delivered pursuant to this Agreement or the
failure by the Trading Advisor to perform any covenant made in this Agreement.
The Partnership will also reimburse any indemnitee for any legal, accounting,
and other expenses incurred by such indemnitee in connection with investigating
or defending any loss, claim, damage, liability, cost, and expense covered by
the indemnities in this Section 12(b). This indemnity shall not apply to any
matter for which the Partnership or the General Partner would be indemnified by
the Trading Advisor under paragraph (a) of this Section 12.
(c) The Partnership agrees to indemnify, defend, and hold
harmless DWR, the General Partner and their affiliates (as defined in Section
14(c) of the Limited Partnership Agreement) from and against any loss,
liability, damage, cost, or expense (including attorneys' and accountants' fees
and expenses incurred in defense of any demands, claims, or lawsuits, and any
amounts paid in any settlement), actually and reasonably incurred arising from
any act, omission, activity or conduct undertaken pursuant to this Agreement by
-29-
or on behalf of the Partnership, including, without limitation, any demands,
claims, or lawsuits initiated by a limited partner of the Partnership (or
assignee thereof), provided that (1) DWR or the General Partner, as applicable,
has determined in good faith that the act, omission, conduct or activity giving
rise to the claim for indemnification was in the best interests of the
Partnership, and (2) the act, omission, activity, or conduct that was the basis
for such loss, liability, damage, cost, or expense was not the result of
misconduct or negligence. The indemnity in this Section 12(c) is in addition to
any liability that the Partnership may otherwise have and will extend, upon the
same terms and conditions, to each person, if any, who controls an indemnified
person within the meaning of the 1933 Act.
Notwithstanding anything to the contrary contained in
the foregoing, neither DWR, the General Partner nor their affiliates shall be
indemnified by the Partnership for any losses, liabilities or expenses arising
from or out of an alleged violation of federal or state securities laws unless
(1) there has been a successful adjudication on the merits of each count
involving alleged securities law violations as to the particular indemnitee, (2)
such claims have been dismissed with prejudice on the merits by a court of
competent jurisdiction as to the particular indemnitee, or (3) a court of
competent jurisdiction approves a settlement of the claims against the
particular indemnitee and finds that indemnification of the settlement and
related costs should be made, provided, with regard to such court approval, the
indemnitee must apprise the court of the position of the SEC and the positions
of the respective securities administrators of Massachusetts, Missouri, and
Tennessee, and/or those other states and jurisdictions in which the plaintiffs
claim that they were offered or sold Units with respect to indemnification for
securities laws violations before seeking court approval for indemnification.
Furthermore, in any action or proceeding brought by a limited partner of the
Partnership in the right of the Partnership to which the General Partner, DWR or
any affiliate thereof is a party defendant, any such person shall be indemnified
only to the extent and subject to the conditions specified in this Section
12(c). The Partnership shall make advances to the General Partner, DWR or their
affiliates hereunder only if: (1) the demand, claim, or lawsuit relates to the
performance of duties or services by such persons to the Partnership; (2) such
demand, claim, or lawsuit is not initiated by a limited partner of the
Partnership; and (3) such advances are repaid, with interest at the legal rate
under Delaware law, if the person receiving such advance is ultimately found not
to be entitled to indemnification hereunder.
(d) DWR agrees to indemnify, defend and hold harmless the
Partnership, the General Partner, the Trading Manager, and each of their
directors, officers, principals, shareholders, controlling persons and their
respective successors and assigns from and against any loss, claim, demand,
damage, liability, cost, and expense, joint and several, to which any indemnitee
may become subject under the 1933 Act, the 1934 Act, the CEAct, the Blue Sky law
of any jurisdiction, or otherwise (including any reasonable investigatory, legal
or other expenses incurred in connection with, and any amounts paid in, any
settlement provided, that, DWR shall have approved such settlement, and in
connection with any administrative proceedings), in respect of the offer or sale
of Units, insofar as such loss, claim, demand, damage, liability, cost, or
expense (or action in respect thereof) arises out of, or is based upon: (i) a
breach by DWR of any representation, warranty, or agreement in this Agreement
-30-
or any certificate delivered pursuant to this Agreement, or the failure by DWR
to perform any covenant made by DWR herein; or (ii) a misleading or untrue
statement or alleged misleading or untrue statement of a material fact made in
the Registration Statement, the Prospectus or any Sales Literature or an
omission or alleged omission to state a material fact therein which is required
to be stated therein or necessary to make the statements therein (in the case of
the Prospectus and any Sales Literature, in light of the circumstances under
which they were made) not misleading, provided that such statement or omission
relates specifically to DWR, or was made in reliance upon, and in conformity
with, written information or instructions furnished by or on behalf of DWR; or
(iii) a misleading or untrue oral statement or alleged misleading or untrue oral
statement of a material fact made by DWR or its employees in the offer or sale
of Units or an omission or alleged omission by DWR or its employees to state a
material fact which is necessary to make the oral statements made not
misleading; or (iv) a violation of any applicable law, rule, or regulation of
any jurisdiction or regulatory authority resulting from the unlawful use of the
Registration Statement, any preliminary Prospectus, the Prospectus, or any Sales
Literature by DWR or its employees. DWR will also reimburse an indemnitee for
any legal, accounting, and other expenses incurred by the indemnitee in
connection with investigating or defending any loss, claim, demand, damage,
liability, cost, and expense covered by this indemnity. The indemnity in this
Section 12(d) is in addition to any liability that DWR may otherwise have.
(e) Promptly after receipt by an indemnitee of notice of the
commencement of any action, claim, or proceeding to which any subsections of
Section 12 of this Agreement may apply, the indemnitee will notify the
indemnifying party in writing of the commencement thereof if a claim in respect
thereof is to be made against the indemnifying party under any of such
subsections; but the failure to so notify the indemnifying party will not
relieve the indemnifying party from any liability which the indemnifying party
may have to the indemnitee under any of such subsections, except where such
failure has materially prejudiced the indemnifying party. In case any action,
claim, or proceeding is brought against an indemnitee and the indemnitee
notifies the indemnifying party of the commencement thereof as provided above,
the indemnifying party will be entitled to participate therein and, to the
extent that the indemnifying party desires, to assume the defense thereof with
counsel selected by the indemnifying party and not disapproved by the
indemnitee, any such disapproval not to be unreasonable. After notice from the
indemnifying party to the indemnitee of the indemnifying party's election so to
assume the defense thereof as provided above, the indemnifying party will not be
liable to the indemnitee hereunder for any legal and other expenses subsequently
incurred by the indemnitee in connection with the defense thereof, other than
reasonable costs of investigation.
Notwithstanding the preceding paragraph, if, in any
action, claim, or proceeding as to which indemnification is or may be available
under any of Sections 12(a) - (d) hereof, an indemnitee reasonably determines
that its interests are or may be adverse, in whole or in part, to the
indemnifying party's interests or that there may be legal defenses available to
the indemnitee which are inconsistent with the defenses available to the
indemnifying party, the indemnitee may retain its own counsel in connection with
such action,
-31-
claim, or proceeding and will be indemnified by the indemnifying party for any
legal and other expenses reasonably incurred in connection with investigating or
defending such action, claim, or proceeding. In no event, however, will the
indemnifying party be liable for the fees and expenses of more than one counsel
for all indemnitees in connection with any one action, claim, or proceeding or
in connection with separate but similar or related actions, claims, or
proceedings in the same jurisdiction arising out of the same general
allegations. The indemnifying party will not be liable for any settlement of any
action, claim, or proceeding effected without the indemnifying party's express
written consent, but if any action, claim, or proceeding is settled with the
indemnifying party's express written consent or if there is a final judgment for
the plaintiff in any such action, claim, or proceeding, the indemnifying party
will indemnify, defend, and hold harmless an indemnitee as provided in Sections
12(a) - (d) hereof, as applicable.
(f) The exculpation provisions in the Management Agreement,
the Customer Agreement, and the Limited Partnership Agreement shall not relieve
any party thereto from any liability it may have or incur to any party under
this Agreement, nor shall any party thereto be entitled to be indemnified by any
party thereto pursuant to the indemnification provisions contained in such
agreements, against any loss, liability, damage, cost or expense it may incur
under this Agreement.
(g) Notwithstanding anything in this Section 12 to the
contrary, Xxxx X. Xxxxx shall have no liability to the Partnership, the General
Partner or DWR under this Agreement or in connection with the transactions
contemplated by this Agreement except for fraud and willful misconduct by Xxxx
X. Xxxxx.
13. Termination. The General Partner shall have the right to
terminate this Agreement at any time prior to the Closing by giving written
notice of such termination to DWR and the Trading Advisor.
14. Survival. The respective indemnities, agreements, obligations,
representations, warranties, and other statements of the parties hereto set
forth in this Agreement or in any certificates delivered pursuant hereto will
remain in full force and effect (regardless of any investigation or any
statement as to the results thereof made by, or on behalf of, DWR, the
Partnership, the General Partner, the Trading Advisor, or any officer, director,
controlling person, or agent of any of the foregoing) and will survive the
delivery of and payment for Units and the termination or expiration of this
Agreement, and the Closing.
15. Notices. All notices required or desired to be given under this
Agreement must be in writing and will be effective when given personally on the
date delivered or, when given by mail, on the date of receipt, addressed as
follows (or to such other address as the party entitled to notice hereafter
designates in accordance with the terms hereof):
-32-
if to the Partnership or the General Partner:
Xxxx Xxxxxx Portfolio Strategy Fund L.P.
c/o Demeter Management Corporation
Two World Trade Center, 62nd Floor
New York, New York 10048
Attn: Xx. Xxxx X. Xxxxxx
President
if to the Trading Advisor:
Xxxx X. Xxxxx & Company, Inc.
Xxx Xxxxxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attn: Ms. Xxxxxxxxx A.M. Kenton
Senior Vice President
if to DWR:
Xxxx Xxxxxx Xxxxxxxx Inc.
Xxx Xxxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xx. Xxxx X. Xxxxxx
Executive Vice President
16. Successors. This Agreement will be binding upon and inure solely
to the benefit of DWR, the Trading Advisor, the Partnership, and the General
Partner (and to the extent provided in Section 12 hereof, the officers,
directors, controlling persons, and agents of the Partnership, the Trading
Advisor, the General Partner, and DWR and the respective heirs, executors,
administrators, successors, and assigns of such persons), and no other person
will acquire or have any rights under or by virtue of this Agreement. No
purchaser of Units will be deemed to be a successor or assign to any party
hereto merely by reason of such purchase.
17. Assignment; Amendment. This Agreement may not be assigned by any
party hereto without the prior express written consent of all other parties.
This Agreement may not be amended except by the express written consent of all
parties hereto.
18. Governing Law; Submission to Jurisdiction; Exclusive
Jurisdiction. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York, without regard to principles of
conflicts of laws. If any action or proceeding shall be brought by a party to
this Agreement to enforce any right or remedy under this Agreement,
-33-
each party hereto hereby consents and will submit to the jurisdiction of the
courts of the State of New York or any federal court sitting in the County, City
and State of New York. Any action or proceeding brought by any party to this
Agreement to enforce any right, assert any claim or obtain any relief whatsoever
in connection with this Agreement shall be brought by such party exclusively in
the courts of the State of New York or any federal court sitting in the County,
City and State of New York.
19. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
-34-
If the foregoing Agreement is satisfactory to you, please so indicate by
signing at the place provided below.
XXXX XXXXXX PORTFOLIO
STRATEGY FUND L.P.
By: Demeter Management
Corporation,
General Partner
By:___________________________________
Xxxx X. Xxxxxx
President
Accepted and Agreed: DEMETER MANAGEMENT CORPORATION
XXXX XXXXXX XXXXXXXX INC.
By:___________________________________
Xxxx X. Xxxxxx
President
By:_____________________________
Xxxx X. Xxxxxx
Executive Vice President XXXX X. XXXXX & COMPANY, INC.
By:___________________________________
-35-
